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Twitter sues to force Musk to complete his $44 bil acquisition

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“Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he — unlike every other party subject to Delaware contract law — is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away,” the suit says.

Delaware is one of the major problems with late stage global capitalism.

If Musk wants to be an anarchic disruptor of such crony capitalism like his idol Iain Banks he should point this out.

https://press.princeton.edu/books/hardcover/9780691180007/whats-the-matter-with-delaware

-1 ( +1 / -2 )

On the other hand, maybe he's realized that it's not really going to be easy to make money out of Twitter - and with regards to his Free-Speech Goal - that won't work, unless he were to perhaps relocate all of Twitter to some less regulated place in the World.

-2 ( +0 / -2 )

Mr. Musk has the raw data from Twitter so he cannot complain about not being given access to the data he demands. Whether he and his analysts understand it is immaterial. I suspect given the short time frame they really do not. He has not offered any kind of factual evidence to back any of his claims so it remains to be seen how he can prove to the satisfaction of the court that Twitter is in serious material breach of the agreement they signed. The burden of proof is on Mr. Musk and the bar is set high in such cases. I think it is a situation where he made a rash and ill considered claim then realized he really doesn't have the liquidity necessary to close the deal. He is fully leveraged borrowing against his stock options and doesn't have enough stock not already committed as collateral to sell to buy Twitter. As Tesla's stock price falls his situation only worsens and there is a real risk that if Tesla stock price continues to fall Mr. Musks lenders will call the loans they made against his stock options as the value of the collateral falls below the outstanding loan balance.

Oh, and Tesla's new factories in Texas and Germany are only producing a tiny dribble of new cars and are bleeding funds to the tune of billions per year. He faces the real prospect of a Tesla bankruptcy.

-1 ( +2 / -3 )

Not a fan of Twitter, nor Musk. But I'm placing my bets on Twitter to succeed in enforcing this deal.

-3 ( +1 / -4 )

Discovery phase will force Twitter to prove their ludicrous “only 5% bots” claim to that court.

I think it is in Twitter best interest to come to a more reasonable price to avoid discovery.

0 ( +2 / -2 )

I think that Twitter should invite Musk to perform the anatomically impossible upon himself. After they pocket his $1 billion deal-breaker fee, of course.

He leapt before he looked. He signed a deal without doing his due diligence. He is basically a troll of the company he is claiming he wants to buy, destroying morale. And he is holding existing shareholders investment at risk so that he can publish some interesting tweets.

Oh, and his ability to pay has been undercut by the nature of his "wealth" which is based on a currency that isn't a currency, and a company that, were it to produce goods in line with it's price/earnings multiple would be one of (if not the largest) car makers in the world and not a niche player.

Yeah, not the look a company wants in it's primary owner.

It's almost like a 51 year old man-child w/ an attention span of a pre-teen w/ ADHD and poor enough judgment to have 10 kids (and counting) isn't the best choice to own or lead a company that is growing but needs a steady hand on the wheel...

1 ( +3 / -2 )

Discovery phase will force Twitter to prove their ludicrous “only 5% bots” claim to that court. 

I think it is in Twitter best interest to come to a more reasonable price to avoid discovery.

From the extremely credit folk who brought you “meme stocks” comes the latest thing: “meme understanding of the law”.

0 ( +2 / -2 )

Me: I’m not going to check the data I was given by the company I want to buy and freely waive my due diligence rights. I commit, legally, to buying this company.

Idiots on the right: Yes!! He’s so powerful!!

Me: Oh god I’ve made a terrible mistake

Idiots on the right: Yes!! He’s so powerful!!

2 ( +4 / -2 )

Discovery phase will force Twitter to prove their ludicrous “only 5% bots” claim to that court.

Yep, that's the thing, these fake a/c's are much much higher, eg. almost 50% of Biden's followers on twitter are these fake a/c's...

https://nypost.com/2022/05/17/half-of-joe-bidens-twitter-followers-are-fake-audit-reveals/

0 ( +2 / -2 )

Why (oh why) would one advocate backing out of a deal that was freely signed in order to bully the seller into a lower acquisition price as an ethical business practice?

Oh, it's not. (And save us the "He was snookered" rant. That hyper has looped, as it were.)

I introduce the concept of "reputational risk." It's the idea that smart businesses don't screw the other side (even if they can) because the damage to their business reputation will outweigh (many times far outweigh) any gains from behaving like a jerk.

Reputational risk assumes that the entity is a known player and that behaving unethically will carry a stigma that will follow the entity in the future. In other words, the organization cannot just skip town like a carnival barker and move on to the next group of rubes.

This requires the ability to look past the next reportning period or trading day. So, beyond the time horizons of some....

Musk agreed to purchase and waived his due dilligence. Now he is trying to sabatoge the deal to get a better price based on a laughable claim.

This is now his "brand" whether he likes it or not. He might have a bit of trouble finding people willing to do business with him after this.

Of course, people kept walking into the roach motel that was any business dealing with the former guy so I could be wrong....

-1 ( +1 / -2 )

Can't stand Twitter but can't stand Musk even more. The guy is great at self promotion and hype.

Yes he can buy a good deal and promote it beyond it's true value making millions in the process ( remember no matter what some say he got his first investment money from his family that got it from a very sketchy mining operation).

I don't know why the Musk cult regardless of facts still refuse to see reality.

Tesla: fat from the great environmental vehicle, needs constant control by the company, is always behind in production and delivery.

The same for the solar, roof.

The starlink satellite internet, etc... Behind schedule with even the preorder customers in zones that are theoretically in operations having no base station because as usual production of those are also behind schedule.

Everything he claims is late or just forgotten and no one notices because the guy is making trouble and headlines on something else diverting the attention.

0 ( +2 / -2 )

Your first mistake, if you do, is USING Twitter.

I don’t use it, and never plan to.

I only have a Facebook account for high school reunion purposes.

“Just say No”.

-1 ( +1 / -2 )

I'd like to say, I have never used Twitter, but as one of my Banks used it for Support, I was forced to connect to them, asking why I couldn't ... connect to them...

I don't see how Twitter can make any money without damaging it's userbase. It lost 200M US$ last year, that was also the Year that Trump got Banned from it, due to Comments he made...

For me, It's clearly not, something I want to use - too dangerous, since if my account were to be personally identifiable - then I could say something one day, that impacts my future career prospects, or my day to day life. To counter that, I'd naturally separate Politics, from various interests, from Work, from Real-life - simply to avoid being targeted - and setup separate accounts for each, but of course, if Twitter got wise to that, then I'd loose everything - so using Twitter, would become a minimalistic exposure option to me, and as such deny Twitter the chance of making money from me.

For advertising scalping - data protection laws are making this harder to monetize.

For free-speech - Governments around the World are introducing laws that prevent this (not just in China).

The Good-old days of Tech Companies, making quick big bucks, has fizzled out, and Twitter is no lesser an example - it has also got competition from the likes of Reddit, Gettr, etc.

I think Musk, having seen and understood the real accounts of Twitter, and has decided to pull out; but is using the "Bots" and lack of info, as a smokescreen - Twitter by suing him, is going to find out, that they will be the ones who will go under first ... when the REAL truth, comes out, and investors finally realize what Junk Tech Stock is like. Instead, of suing him, he should simply loose any future opportunity of buying Twitter, even should they make the Company into something better - plain an simple....

Life without Twitter, will be no big deal. The same could be said too of Facebook, though it's simply acting as a centralized BBS/Website for other Community groups/Companies, and that, has monetarization value. As for Meta-verse - Global recession will put that one on ice for a bit, as too the concept in it's current format.

And if it comes to Nuclear war - who cares - we're all Dead. NYC has started advising its residents what to do in the event of a Nuclear Strike.... basically die in situ. So perhaps, its time to go out an enjoy yourselves, have fun, not too much, since things may turn out for the better, but, never-the-less, go out and enjoy yourselves - for who knows, today may be your last... PEACE!

-2 ( +0 / -2 )

Tech Companies Globally, have another issue - they all rely upon consuming vast amounts of "Electricity" for their Data Centers... and clearly, unless you've been living under a Rock for the past 1/2 year or so, that is something that is going to become more expensive ... potentially exponentially so, over the next couple of months. Cloud Services may benefit, as Companies try to rapidly move their own services onto a more cost efficient service, though that will inevitably lead to price increases within the current environment, which will be fed back to Customers, or lead to lower profit margins... Microsoft's Azure, and Amazon's AWS services are probably good ("stable") investment opportunities - Twitter uses AWS, so expect to see its margins drop, as Amazon passes on the Operational Costs over to it, and given Twitter lost 200M last year, I doubt, you'll see anything better this year...

-1 ( +0 / -1 )

Discovery phase will force Twitter to prove their ludicrous “only 5% bots” claim to that court. 

That one quote pretty much verifies what I have long suspected. Even with the full fire hose of data from Twitter Mr. Musk's team could not make heads or tails of the data. They really do not know how many bots there may or may not be because their analysts haven't spent years working with Twitter data to know what it means. They are guessing there are "probably" more bots but can't prove it. Mr. Musk wants a court to do what his people can't. It's laughable.

0 ( +1 / -1 )

Discovery phase will force Twitter to prove their ludicrous “only 5% bots” claim to that court.

Actually, at this point the burden of proof is on Mr. Musk to demonstrate that the 5% figure is incorrect and that Twitter is in seriouis material breach of their contract. One does not necessarily imply the other. A court may rule that a different number of bots is not a "serious material breach" under Delaware contract law. Mr. Musk waived due diligence before signing the contract to buy Twitter. Now in order to back out of the deal under Delaware law he has to prove Twitter is in serious material breach of the agreement. I sincerely doubt he can. In the history of Delaware corporate law there has only been one occasion where a buyer was able to back out of a deal successfully by proving the seller was in serious material breach of the agreement. In all likelihood Mr. Musk is going to lose and be forced to buy Twitter or, if the judge is kind, Mr. Musk will be forced to pay Twitter the Billion bucks they agreed to if either side backs out.

1 ( +1 / -0 )

Musk is running out of time on everything.

Most of his businesses are running behind schedule and the shine and excuses are no longer keeping people quiet or happy.

He says a lot more than he actually does or delivers.

Starlink behind schedule and by the time it is all in place it will more likely be far too slow compared to other systems. Presently it always uses places in developing countries countries to show how much faster it is but never in places with access to high-speed Internet and now 5G networks.

He is a self promoter now craves the spotlight more than actually getting things done.

0 ( +2 / -2 )

Welcome to MAGA-world Elon.....

Just a few weeks ago you were the hero of the far-right....a shining knight marching to save their so-called beloved "freedom of speech", someone praised every night on Fox News....

Now?

"When Elon Musk came to the White House asking me for help on all of his many subsidized projects, whether it's electric cars that don't drive long enough, driverless cars that crash, or rocketships to nowhere, without which subsidies he'd be worthless and tell me how he was a big Trump fan and Republican, I could have said, "drop to your knees and beg," and he would have done it," Trump wrote.

https://www.reuters.com/world/us/its-time-trump-sail-into-sunset-says-musk-2022-07-12/

And just like that, you go from hero to scum...

Well, you can at least commiserate with Pence, Miller, Barr, KellyAnne, Cipollone, and Ivanka....

ROFL...

-1 ( +1 / -2 )

He signed that contract. So he has to fight that contract that he signed. At the very least, he may have to pay for breach of contract

He started that whole mess that led to the contract, so he can't say that he went into that deal blind

(Remember, he started by asking the public on his Tweet poll whether he should buy Twitter)

He's one of those who's notorious for doing things on impulse, then trying to walk it back

(That's how he got in trouble with the SEC for his Tweets that affect other people's money and investments)

Being an internet troll is not easy when a lot of money become involved

Be careful not to rely on what people who's impulsive do - there's always a good chance they'll walk it back, lol

0 ( +0 / -0 )

and with regards to his Free-Speech Goal - that won't work, unless he were to perhaps relocate all of Twitter to some less regulated place in the World.

And even then, he can only operate such a Twitter in that place in the world - while other places in the world Twitter cannot operate, unless Twitter has to follow the rules of those lands

0 ( +0 / -0 )

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